Correlation Between Rongsheng Petrochemical and Ye Chiu
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By analyzing existing cross correlation between Rongsheng Petrochemical Co and Ye Chiu Metal, you can compare the effects of market volatilities on Rongsheng Petrochemical and Ye Chiu and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Rongsheng Petrochemical with a short position of Ye Chiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rongsheng Petrochemical and Ye Chiu.
Diversification Opportunities for Rongsheng Petrochemical and Ye Chiu
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Rongsheng and 601388 is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Rongsheng Petrochemical Co and Ye Chiu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ye Chiu Metal and Rongsheng Petrochemical is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Rongsheng Petrochemical Co are associated (or correlated) with Ye Chiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ye Chiu Metal has no effect on the direction of Rongsheng Petrochemical i.e., Rongsheng Petrochemical and Ye Chiu go up and down completely randomly.
Pair Corralation between Rongsheng Petrochemical and Ye Chiu
Assuming the 90 days trading horizon Rongsheng Petrochemical Co is expected to generate 0.78 times more return on investment than Ye Chiu. However, Rongsheng Petrochemical Co is 1.29 times less risky than Ye Chiu. It trades about 0.04 of its potential returns per unit of risk. Ye Chiu Metal is currently generating about 0.02 per unit of risk. If you would invest 943.00 in Rongsheng Petrochemical Co on September 1, 2024 and sell it today you would earn a total of 11.00 from holding Rongsheng Petrochemical Co or generate 1.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rongsheng Petrochemical Co vs. Ye Chiu Metal
Performance |
| Timeline |
| Rongsheng Petrochemical |
| Ye Chiu Metal |
Rongsheng Petrochemical and Ye Chiu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rongsheng Petrochemical and Ye Chiu
The main advantage of trading using opposite Rongsheng Petrochemical and Ye Chiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rongsheng Petrochemical position performs unexpectedly, Ye Chiu can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ye Chiu will offset losses from the drop in Ye Chiu's long position.| Rongsheng Petrochemical vs. Zijin Mining Group | Rongsheng Petrochemical vs. Wanhua Chemical Group | Rongsheng Petrochemical vs. Baoshan Iron Steel | Rongsheng Petrochemical vs. Shandong Gold Mining |
| Ye Chiu vs. Zijin Mining Group | Ye Chiu vs. Wanhua Chemical Group | Ye Chiu vs. Baoshan Iron Steel | Ye Chiu vs. Shandong Gold Mining |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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